The "Alliance for Open Competition" or "Noncompete Agreements Should Not Be Enforceable in Massachusetts"

by Lee Gesmer on February 11, 2008

In December I wrote a post title Why Has Silicon Valley Outperformed Boston/Route 128 as a High Tech Hub? The topic was whether the legality of noncompete agreements (“NCAs”) in Massachusetts has put the state at a disadvantage to California, where NCAs are not enforceable.

The Alliance for Open Competition is a blog where people and organizations who would like Massachusetts to join California (and other states) and make NCAs illegal express their views on this issue.

The first entry in the blog is Spark Capital’s open letter to Governor Deval Patrick in early December 2007.

The purpose of the Alliance is described as follows:

The Alliance for Open Competition is a group of entrepreneurs, investors and executives dedicated to fostering innovation throughout the US. We seek to breakdown a major barrier to entrepreneurialism: the use of non-competition agreements mandated by employers that force employees to sign away their rights to engage in any business of a competitive nature when they leave their present jobs. Today Massachusetts, New York and Michigan are among dozens of other states that still enforce non-compete clauses.

We believe that employment non-competes are stifling the emergence of start-up companies in these states, forcing innovative entrepreneurs to take on tremendous legal and financial risks, and hampering the ability to meet our fullest economic potential as a nation. To be clear, we do support non disclosure agreements and non-solicitation agreements. The Alliance is opposed to non-compete agreements. They are different issues.This blog will serve to share related topics, stories, news & links about this effort.

Many of the large high tech companies in Massachusetts believe that noncompete agreements are in their best interests, and I suspect that there is quite a bit of lobbying going on behind the scenes on this issue. It will be no small undertaking for the Alliance to unseat over one hundred years of Massachusetts common law permitting enforcement of NCAs.

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